PRОJECT REPORT

ОN
"FINANCIAL ANALYSIS OF LUCKNOW FOOD PRODUCERS
COOPERATIVE MILK UNION WITH SPECIAL EMPHASIS
ON WORKING CAPITAL"

Submitted by:
SHIVA SINGH
MBA ( Finance)
Enrоlment nо: A7001918017
Under guidance оf:
Dr. Praveen Kumar Sharma
Amity Finance Schооl

AMITY UNIVERSITY
LUCKNОW
Sessiоn : 2016-19
 TABLE OF CONTENT
CERTIFICATE
ACKNOWLEDGEMENT
PREFACE
EXECUTIVE SUMMARY

(1) Company Profile

(2) Introduction Of The Company
(3) History Of The Organization
(4) Organization Structure
(5) Product Profile
(6) Introduction Of The Topic
(7) Research Methodology
(8) Data Analysis And Interpretation
(9) Findings And Conclusions
(10) Suggestions And Recommendations
(11) Limitations
(12) Bibliography
(13) Appendix
 CHAPTER-1
ORGANISATION
STRUCTURE
 RATE OF MILK AND MILK PRODUCT

Name of Milk & Milk Product Agent Rate Consumer Rate

25.50P/L 27.00

1. F.C.M.
20.00P/L 22.00
2. TONED MILK
17.00 P/L 18.00
3. JANTA MILK

4. LOOSE MILK (IN CANTS) 19.00 P/L 20.00

5. GHEE/1LITER PACK
215.00 P/L 250.00
6. BUTTER 100 GRAM
15 RS 20 RS
7. BUTTER 500 GRAM

72.50 RS 90 RS
8. PANEER

147.00 P/KG 170.00

9. MATTHA (200 ML)

4.50 P.P. 5.00

10. DAHI

9.00 P. CUP 10.00

 CHAPTER-2
LITERATURE REVIEW
Karki, Bir Bahadur (2005) described in titled ‘Strategic Planning in Co- operative Sector:

A Study on Dairy Co-operative’ viewed that Dairy cooperative is a very popular business

not only in developing countries but also in developed countries. They cannot compete

with the developed countries. Developed countries have been giving emphasis on the

enhancement of dairy product and market expansion. Thus they suggested that strategic

planning of developing countries must be to increase production volume of buffalo milk

and to bring about the internal improvement in cooperative societies, to reduce cost of

production, and to provide quality service to consumer through skilled, trained and

educated manpower, e-commerce.

 OBJECTIVES OF THE RESEARCH

 To Know the Financial position of the Parag.

 The company has the strength to fulfill its obligation or not.

 Growth Rate of Parag.

 To know the Net Worth.

 To estimate the business valuation of Parag.

 To know the Current Ratio.

 To know the Fixed Turnover Ratio.

 CHAPTER -3

STUDY PROCESS

Formulating the Study problem

Extensive literature survey

Preparing the Study design

Determining the sample design

Collection the data

 Analysis of data

Preparation of report

SAMPLE DESIGN

Samples can be either probability or non probability samples.

SAMPLING TECHNIQUE: Simple random sampling.

SAMPLING AREA

Study the sampling unit is Lucknow.

SAMPLE SIZE is 70.

SAMPLE UNIT: Respondents [18 to 30 yrs]

COLLECTION OF DATA

Primary: Survey method has been used for the purpose

Secondary: it is collected from books, Study papers, magazines, news papers, journals, and

internet

 Percentage Analysis

Percentage = (Number of respondents/Total no of respondents)*100

 CHAPTER-4
DATA ANALYSIS
&
INTERPTRETATIONS
 DATA ANALYSIS AND INTERPRETATION

BALANCE SHEET

Lucknow Food producers cooperative milk union (parag)

Data collected from the trading and profit & loss a/c (figure in lac);

Particular 2017 2016 2015

Net sale 1326.46 1142.80 1016.32

Fixed assets 636.12 631.32 633.87

Current assets 1013.94 689.12 477.72

Current liabilities 695.70 539.05 471.73

Gross profit 291.82 251.41 223.59

Closing stock 528.57 460.58 298.44

Credit sale 1127.49 971.38 863.87

Cost of good sold 1034.64 891.39 792.73

Q1.) Compare Current Ratio of Bharat State Milk Co-Operative Ltd. for 3 years?

Current Ratio = Current Assets / Current Liability

2012 = 1013.94/695.70 = 1.457 : 1

2011 = 689.12/539.05 = 1.278 : 1

2010 = 477.72/471.73 = 1.013 : 1

Current Ratio

1.6

1.4

1.2

0.8 1.457
1.278
0.6 1.013
0.4

0.2

0
2015 2016 2017

Interpretation:-

 Ideal current Ratio is 2:1

 Though there is an increasing trend in the company’s current ratio in the past 3 years.

 Current moves in between 1.013 to 1.457.

 Current ratio is highest in the year 2012 i.e. 1.457.

Q2.) Compare the Quick Ratio of Lucknow Food producers cooperative milk union (parag)
for 3 years.?
Quick ratio = Quick Asset/Current Liability

2012 = 485.37/695.70 = 0.6976 : 1

2011 = 228.54/539.05 = 0.424 : 1

2010 = 179.28/471.73 = 0.380 : 1

Quick Ratio :

0.7

0.6

0.5

0.4 0.6976

0.3
0.424
0.2 0.38

0.1

0
2011 2016 2017

Interpretation:-

 Ideal Quick Ratio is 1:1

 There is an increasing trend in the company’s Quick ratio in the past 3 years.
  Liquidity ratio highest year 2012 i.e. 0.6976 which is nearly close to ideal ratio.

Q3.) Compare the Inventory Turnover Ratio of Lucknow Food producers cooperative milk
union (parag) for 3 years?
Inventory Turnover Ratio = Sales/Closing Stock

2012 = 1326.46/528.57 = 2.5 times

2011 = 1142.80/460.58 = 2.48 times

2010 = 1016.32/298.44 = 3.40 times

Inventory Turnover Ratio

3.5

2.5

2
3.4

1.5
2.48 2.5

0.5

0
2010 2011 2012

Interpretation:-

 The company had highest inventory turnover ratio in the year 2010, thought it was reduced

in the year 2011 and increased in year 2012 with a short margin.
  Company improve itself from last year ‘s decline.

Q4.) Compare the Debtor Turnover Ratio of Lucknow Food producers cooperative milk
union (parag) for 3 years?

Debtor Turnover Ratio = Credit Sales/Debtors

2012 = 1127.49/ 224.17 = 5.03

2011 = 971.38/202.46 = 4.80

2010 = 863.87/103.48 = 6.62

Debtor Turnover Ratio

4
6.62
3 5.03
4.8

0
2015 2016 2017

Interpretation:-

 The company had lowest credit sales in 2017 and highest in the year 2016.

 It shows that in the year 2017.

 The company’s maintain a moderate debtor turnover ratio i.e. 5.03

Q5.) Compare the Capital Turnover Ratio of Lucknow Food producers cooperative milk
union (parag) for 3 years?
Capital Turnover Ratio= Cost of Goods Sold/Capital Employed

2012 = 1034.64/25.12 = 41.19

2011 = 891.39/11.92 = 74.78

 2010 = 792.73/23.31 = 34.0

Capital Turnover Ratio

80

70

60

50

40 74.78

30
41.19
20 34.01

10

0
2010 2011 2012

Interpretation:-

 The company had highest capital turnover ratio in the year 2017.
 It shows that the company utilized its capital employed most efficiently in the year 2017.
Q6.) Compare the Working Capital of Bharat State Milk Co-Operative Ltd. for 3 years?
Working Capital = Current Assets – Current Liability

2012 = 1013.94 - 695.70 = 318.24

2011 = 689.12 – 539.05 = 150.07

2010 = 477.72 – 471.73 = 5.99

Working Capital

350

300

250

200
318.24
150

100 150.07

50
5.99
0
2015 2016 2017

Interpretation:-

 The company’s lowest net working capital in year 2016 was 5.99 lacs.
 But company improved financial condition with better cash inflow option And gain highest
in the year 2012. i.e. 318.24 lacs.
Q7.) Compare the Fixed Turnover Ratio of Lucknow Food producers cooperative milk union

(parag) for 3 years.

Fixed Turnover Ratio = Sales/Net Fixed Assets

2015 = 1326.46/636.12 = 2.09

2016= 1142.80/631.32 = 1.81

2017 = 1016/633.87 = 1.60

Fixed Turnover Ratio

2.5

1.5

2.09
1.81
1 1.6

0.5

0
2015 2016 2017

Interpretation:-

 In 2010 the company had lowest fixed turnover ratio and highest in the 2017.
Q8.) Compare the Gross Profit of Bharat State Milk Co-Operative Ltd. for 3 years.

Gross profit = Gross Profit*100/Sales

2012 = 291.82*100/1326.46 = 21.99%

2011 = 251.41*100/1142.80 = 20.26%

2010 = 223.59*100/1016.32 = 18.53%

Interpretation:-

 The company had shown an increasing trend in the past three year.

 The company had highest gross profit in year 2017.

 There is the 16.07% increase in gross profit from 2016.

 This shows the soundness of the company.

Q9.) Comparison of the Current Assets & Current Liability:

Years Current Current

Assets Liability

2015 477.72 471.73

2016 689.12 539.05

2017 1013.94 695.70

1200
1013.94
1000

800 689.12 695.7

539.05 Current Assets

600 477.72 471.73
Current Liability
400

200

0
2015 2016 2017

Interpretation:-

 The company shows an increasing trend in net working capital in past three year.

 So it increase its current asset more than current liabilities

 The current asset is lowest in 2015 while it is highest in the year 2017.


CHAPTER-5
FINDINGS

&

RECOMMENDATIONS
 FINDINGS

 The company’s Current Ratio is 1.457 : 1 which is Increasing Continuously.

 And It is going close to the Ideal Ratio 2:1.
 Company’s Quick Ratio is 0.698 : 1 which is Increasing Continuously.
 And it is going close to the Ideal Ratio 1:1.
 The company had shown an increasing trend in gross profit ratio in last 3 years.
 In 2016 the company had lowest fixed turnover ratio and highest in the 2017.
 The company shows a decreasing trend in Inventory turnover.
 Company’s debtors are increasing with a slow rate every year, this analysis shows that the
company have moderate credit policy.
 The company had highest capital turnover ratio in 2016.
 It shows that the company utilize it’s capital employed efficiently in 2016.
 But due to some reasons it decrease again in 2017.
 In 2010 the company had very nominal working capital i.e only 5.99 lacs
 But it increases in next year’s and reach on 150.07 lac with the in 2016.
 And 318.24 lac in 2017.
 In 20106the company had very nominal working capital i.e only 5.99 lacs
 But it increases in next years and reach on 150.07 lac with the in 2016.
 And 318.24 lac in 2016.
 In 2016, there is nominal difference between current Assets & Current Liability.
 But in 2017, the company improves the condition and make a good difference.
 In 2017 company again improve it’s current Assets more than last years.
 RECOMMENDATIONS & SUGGESTIONS

 Quality of Plastic for Packaging must be improved.

 Packaging should be standardized & made attractive.

 The Hollow Cavity at the base should be more to provide extra support for the bottle to

withstand.

 Intense Finance and promotions activities are required to Lucknow region for Customer

awareness to show its mere presence in the market in the Mineral Water & Soda Segment.

 Regular checks should be made to see that the salesman introduces the schemes regularly,

properly and on time to the retailers, which are introduced by the company.

 The Salesman should at least visit once in a weak to those retailers which doesn’t stock

Kingfisher, with some new offers and schemes to increase the market share.

 Should not depend much on distributors as they doesn’t introduce schemes, doesn’t provide

proper service and supply.

 The retailers which purchase same quantity should be given same schemes in order to

remove biasness.

 The company representative like the area sales manager should visit once in 2 months to

the present retail customers for the overall satisfaction of the retailer and to check

performance of the product.

 The company should invest in promoting the brand name Kingfisher to make it a WORD

OF MOUTH, which ultimately helps in Brand Management.

 Salesman should wish the retailers as they visit the outlets for supply in order to maintain

good customer relation.

 Regular meetings should be arranged with the company staff in order to know the practical

problems faced by them and should be resolved suitably.

CHAPTER-6
CONCLUSIONS
 CONCLUSION

When I analyzed the overall performance I conclude the study i.e.-

Firm’s liquidity position is satisfactory and meets out its obligations.

 The sale of the company fluctuated due to not utilizing its resources properly.

 Company is following a liberal credit policy.

 There is a need to improve the level of the company.

 Overall company is in sound Position according to it’s level.

BIBLIOGRAPHY
 BIBLIOGRAPHY

 Annual report of Parag

 http://www.Parag dairy.com/

 http://www.wikipedia .com

 National dairy development board http://www.nddb.org/